Am I missing something here or am I oversimplifying?
No, but we are talking different values. It is hard to tell how yield impacts either performance, prices are so volatile and the company will not reveal it anyway. You can claim victory on yield as long as you want, it's your business anyway!
I am pointing at the claimed economical and environemental performance of the A380. If you look at the values it delivers, kg fuel vs. kg payload, both are behind the 777. Maybe NOx is better, but the burn is way too high. Explanation is simple: The bird weighs too much, not only due to the pathetic EK implants, but just as much coming out of Toulouse. It should be sent back Toulouse some weight!
A brand new aircraft design should basically not rely on yield to beat its rivals, as yield shows too many outside influences, not well controlable by the operator. It should outperform on burn vs. load and distance in the first place.
Second thing that is noteworthy: The 777 was the first all new aircraft designed from schratch, entirely by CAD, as almost all new designs after it. That was a huge risk, I remember all the predictions about entry in service. Now looking back, it made this very smoothly, good dispatch reliablity right from the start and kept it up to today. I just say that because this argument is now streched to excuse the not so shiny reliability of the A380, also a new plane designed by CAD (oh, yeah ...) and with basically the same technology.
I would have loved the bird to succeed, but it is quite a flop up to today and needs some serious revamping. EADS and EK might succeed in doing just that, but they will not, if they continue to cover-up the deficiencies, just for
PR and face saving issues. Admit the flaw, like Ferrari at the F1 today, and stick your ears between your legs and start working on improvement.